Competition, Corporate Governance, and Regulation in Central Asia : Uzbekistan's Structural Reform Challenges

In Uzbekistan state enterprises are being changed into shareholding companies, and private enterprises account for 45 percent of all registered firms. But business decisions to set prices, output, and investment are often not market-based, nor wholly within the purview of businesses, especially those in commercial manufacturing and services. Lines of authority for corporate governance - from state enterprises to private enterprises - are ill-defined, so there is little discipline on corporate performance and little separation between government and business. Nascent frameworks have been created for competition policy (for firms in the commercial sector) and regulatory policy (governing utilities in the infrastructure monopoly sector). Bur implementation and enforcement have been hampered by old-style instruments (such as price controls0 rooted in central planning, by lack of a strong independent regulatory rule-making authority, by the limited understanding, of the basic concepts of competition and regulatory reform, and by weak institutional capabilities for analyzing market structure and business performance. Based on fieldwork in Uzbekistan, the author recommends: 1) Deepening senior policy officials' understanding of, and appreciation of the benefits from, enterprise competition and how it affects economic growth. 2) Reforming competition policy institutions and legal frameworks in line with the country's goal of strengthening structural reforms and improving macroeconomic policy. 3) Improving the ability of government and associated institutions to assess Uzbekistan's industrial market structure and the determinants of enterprise conduct and performance. 4) Making the authority responsible for competition and regulatory policymaking into an independent agency - a "champion" of competition - answerable directly to the prime minister. 5) Strengthening incentives and institutions for corporate governance and bringing them in line with international practice. 6) Subjecting infrastructure monopolies to systemic competitive restructuring and unbundling, where appropriate. For other utilities, de-politicize tariff setting and implementation of regulations; ensure that price, pro-competitive (creating a level playing field among users); and increase transparency and accountability to the public.

Bibliographic Details

Main Author:	Broadman, Harry G.
Language:	en_US
Published:	World Bank, Washington, DC 2000-05
Subjects:	accountability, advertising, anti-monopoly committee, asset management, asset value, audits, authority, bankruptcy, barriers to entry, coal, collusion, competition legislation, competition policy, competitiveness, consensus, consumers, corporate governance, corruption, debt, decision-making, decree, decrees, dividends, domestic market, economic criteria, economic development, economic research, economies of scale, empirical studies, employment, enactment, energy prices, enforcement of competition, equilibrium, exchange rate, exports, external incentives, financial resources, financial subsidies, fiscal, fixed costs, foreign direct investment, foreign exchange, foreign exchange liberalization, foreign exchange regime, foreign investors, government officials, government programs, government's policy, human capital, imports, insolvent, institutional framework, institutional investors, institutional resources, international arbitration, labor market, legislation, legislative authority, legislative drafting, legislative framework, legislature, lobbying, local authorities, local government, local governments, macroeconomic policy, macroeconomic reform, macroeconomic stability, market competition, market demand, market distortions, market economy, market forces, market incentives, market power, market prices, market reforms, market share, market structure, market value, ministers, ministry of finance, monopolies, monopoly, national level, natural monopolies, oil, organizational structure, organizational structures, ownership structure, price control, price controls, price distortions, producers, production processes, productive assets, profit maximization, property rights, public hearings, public procurements, regulatory capture, regulatory oversight, regulatory policies, regulatory policy, regulatory regime, republics, retained earnings, safety nets, social costs, social safety, social safety nets, state anti-monopoly policy, state assets, state enterprises, state-owned enterprises, suppliers, taxation, transition economies, transparency, unfair competition, WTO, regulatory framework, competition (economic), microeconomics, structural reforms, enterprise development, private sector development, investments, pricing reforms, business decision-making, market-based instruments, corporate performance, commercial performance indicators, manufacturing, economic growth, legal framework, industrial marketing, infrastructure reform, tariff reforms, price policy,
Online Access:	http://hdl.handle.net/10986/21585
Tags:	Add Tag No Tags, Be the first to tag this record!